Gold Price Futures (GC) Technical Analysis – In Position to Test Key Retracement Zone at $1215.20 to $1207.90

December Comex Gold was pressured again on Wednesday for a third session as investors continued to react to increased demand for higher risk assets, rising U.S. Treasury yields and a stronger U.S. Dollar. Gold was also pressured by better-than-expected private sector employment data after an ADP report showed companies hired more employees than expected in October. Furthermore, a U.S. Labor Department report showed a huge jump in wages and salaries, supporting the Fed’s plan to raise interest rates in December.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A new main top has formed at $1246.00. A trade through this level will signal a resumption of the uptrend.

A trade through $1184.30 will change the main trend to down so the trend appears to be safe at this time. In fact, the market is still completing a normal 50% to 61.8% retracement.

The short-term range is $1184.30 to $1246.00. Its retracement zone at $1215.20 to $1207.90 is the primary downside target. This zone was tested on Wednesday. Since the main trend is up, buyers could start to come in on a test of this zone.

On the upside, retracement zone resistance comes in at $1222.70 then $1235.80.

Daily Swing Chart Technical Forecast

Based on Wednesday’s close and the price action, the direction of the December Comex Gold market on Thursday is likely to be determined by trader reaction to the main 50% level at $1215.20.

A sustained move over $1215.20 will indicate the presence of buyers. This could trigger a rally into the first 50% resistance level at $1222.70. This is a potential trigger point for an acceleration to the upside with $1235.80 the next major upside target.

A sustained move under $1215.20 will signal the presence of sellers. If this move creates enough downside momentum then look for a break into the short-term Fibonacci level at $1207.90.

The daily chart is wide open under $1207.90. If this fails as support and it attracts enough selling volume, we could see a steep plunge.